KTEH Facing the Mortgage Crisis

Forensic Loan Audits—What Are They? Should I Pay For One?

Forensic Loan Audits—What Are They? Should I Pay For One?
A “forensic loan audit” is a term that is being used to refer to someone looking over a homeowner’s loan documents in order to determine whether there is anything legally wrong with the loan. Companies and individuals that advertise this service promise to provide a written report of these legal violations, and that report is supposed to help the homeowner get a better loan modification or find an attorney who will file a lawsuit on behalf of the homeowner.

The problems with these audits are:

(1) The audits are frequently poorly done, with very little information in the audit report about what was wrong with your loan. The audit reports usually have a lot of canned, standard language that appears to be cut and past from one report to another and does not help you, the homeowner, very much.

(2) Audits are not always performed by attorneys, or the attorney involved does not have much experience in the area of mortgages, consumer rights, or mortgage fraud. As a result, the audit report can be inaccurate and a complete waste of money.

(3) Showing an audit report to a mortgage lender or servicer is not usually enough to get a loan modification. If you have real legal problems with the loan, you will need an attorney who is willing to work with you for the weeks and perhaps months it will take to get a positive outcome.

(4) Some legal problems with documents are not strong enough to pressure a lender or servicer into providing a loan modification. The people who prepare audit reports do not tell you that.

(5) Forensic loan audits are expensive – $1500 and more.

(6) You may be able to get legal assistance for free from Housing and Economic Rights Advocates (HERA) at 510 271-8443. Call for intake hours.

(7) You can get FREE LOAN MODIFICATION ASSISTANCE from HUD-certified housing counseling agencies. Visit HUD’s website to find the offices closest to you, at http://www.hud.gov/local/ca/homeownership/hsgcounseling.cfm

One more thing: This past year, a new law was passed in California that prohibits anyone – including attorneys, realtors and brokers—from charging or collecting any money from consumers for loan modification work until that work has been completed. If the forensic loan audit is being offered as a way to help you get a better modification, then the person or company offering this service cannot charge you money up front for this service.

For a list of places you can complain to if you have been defrauded, visit the following website of the California Department of Real Estate: http://www.dre.ca.gov/pdf_docs/FraudWarningsCaDRE03_2009.pdf

San Mateo Still Haunted by Lehman’s Ghost.

The Wall Street Journal reports, “Dozens of cities and counties around the country, from Sarasota, Fla., to Boulder, Colo., lost a total of $1.7 billion when Lehman Brothers went under, because they held Lehman bonds or other securities. San Mateo County’s loss was the biggest of any municipality.”

“San Mateo saw $155 million evaporate when Lehman Brothers went bankrupt in September 2008. On top of deep budget cuts brought on by California’s fiscal crisis, the loss on Lehman securities means San Mateo’s 735,000 residents are taking a hit.”

Read the full article here.

President Obama’s Mortgage Aid Headed to California

This morning President Barack Obama announced a $75 billion mortgage relief plan for families that have “played by the rules.” This is one is one in a series of measures the president says will keep 9 million people from losing their homes. Here is a clip of his announcement this morning.

Free Credit Seminar in Aptos

If your loan modification has been halted by a low credit score or a foreclosure has damaged your credit score, there are remedies. Learning about how your credit is rated will help you take steps toward improvement and avoid the kind of missteps that lead to a negative rating.

If you live in Santa Cruz County, you may want to attend a free credit score seminar being offered by Bay Federal Credit Union 6-7:30 p.m. next Wednesday (Feb. 24) at Cabrillo College Student Activity Center East Room 225, 6500 Soquel Drive. It’s free but you need to register in advance. Call 831-477-8427 or email Seminar@bayfed.com.

If you can’t attend, here’s a link to the Federal Trade Commission’s page on repairing your credit.

A word of caution-advertisements from companies making claims that they can “erase bad credit” or “create a new credit record” are usually scams so be careful. If you need assistance, look for a Non-profit credit counseling organization like Consumer Credit Counseling Service of Ventura County, San Jose. CCCS is a KTEH partner in the Facing the Mortgage Crisis initiative. They serve Santa Cruz and Santa Clara Counties and often answer questions on this blog on the “get expert advice” page.

Help For Renters with Homes in Foreclosure

A new law was passed in May that protects tenants whose landlords fall into foreclosure. Under the Helping Families Save Their Homes Act, tenants have the right to stay in their homes after foreclosure for 90 days or through the term of their lease. The bill also provides similar protections to housing voucher holders.

The message hasn’t filtered down to everyone, though. If you are renting a property that is in foreclosure, you may get a 60 or even 30 day notice to move. Don’t accept these notices at face value, is the advise of attorney Shirley Gibson, they may not be legal. Here’s more advise for renters from Shirley Gibson of the Legal Aid Society of San Mateo:

Free legal help is available to you from your local Legal Aid Society. Click here for a list of KTEH’s partners who can help with legal and other foreclosure issues.

En Espanol: Facing the Mortgage Crisis (Part 3 of 3)

Facing The Mortgage Crisis: En este programa de tres partes, KTEH monto a un grupo de expertos que ofrecen consejo sobre ejecucion de hipoteca, la prevencion de la ejecucion de hipoteca, la modificacion del prestamo, prestamos rapaces, fraude de las propiedades inmobiliarias, las derachas de los inquilinos y mas. Se ha doblado en espanol.

En Espanol: Facing the Mortgage Crisis (Part 2 of 3)

Facing The Mortgage Crisis: En este programa de tres partes, KTEH monto a un grupo de expertos que ofrecen consejo sobre ejecucion de hipoteca, la prevencion de la ejecucion de hipoteca, la modificacion del prestamo, prestamos rapaces, fraude de las propiedades inmobiliarias, las derachas de los inquilinos y mas. Se ha doblado en espanol.

En Espanol: Facing the Mortgage Crisis (Part 1 of 3)

Facing The Mortgage Crisis: En este programa de tres partes, KTEH monto a un grupo de expertos que ofrecen consejo sobre ejecucion de hipoteca, la prevencion de la ejecucion de hipoteca, la modificacion del prestamo, prestamos rapaces, fraude de las propiedades inmobiliarias, las derachas de los inquilinos y mas. Se ha doblado en espanol.

211 is Ready to Help Those Facing a Mortgage Crisis

Carole Leigh Hutton, President and CEO of United Way Silicon Valley, outlines the many kinds of help available through the United Way’s 2-1-1 service, from housing counseling to basic needs like food and shelter.

For more information, click here or dial 211. As thousands of families in Northern California face foreclosure, KTEH is working to connect them with the help they need.

Watch: Facing the Mortgage Crisis (Part 4 of 4)

In this 4 part program, KTEH assembled a group of experts who offer advice on foreclosure, foreclosure prevention, loan modification, predatory loans, real estate fraud, tenants rights and more.